Crude Oil Climbs Amid G7 Dissusions On Russian Exports
Oil prices extended gains on Monday as investors stood on guard for any moves against Russian oil and gas exports that might come out of a meeting of leaders of the Group of Seven (G7) nations meeting in Germany.
The prospect of more supply tightness loomed over the market as western governments sought ways to cut Russia’s ability to fund its war in Ukraine, even though G7 leaders were also expected discuss a revival of the Iran nuclear deal – which might lead to more Iranian oil exports.
Brent crude futures and U.S. West Texas Intermediate crude posted their second weekly decline last week as interest rate hikes in key economies strengthened the dollar and fanned recession fear.
However, oil prices remained well supported above $100 a barrel while prompt monthly spreads remained wide in backwardation as crude and oil product supplies remained tight.
G7 leaders, who began their meeting on Sunday, are expected to discuss options for tackling rising energy prices and replacing Russian oil and gas imports, as well as further sanctions that do not exacerbate inflation.
These measures include a possible price cap on Russian oil exportsto reduce Moscow’s revenues while limiting damage to other economies.
G7 will also discuss the prospect of reviving the Iran nuclear talks after the European Union’s foreign policy chief met senior officials in Tehran to try to unblock the stalled negotiations, a French presidency official said on Sunday.
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